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cargo carriage.

Such a total conversion from troop capability

to cargo capacity indicates greater reliance on future air transport for personnel coupled with the need for greater cargo lift.

Here again, the question becomes one of relative value to be derived from total dollar expenditures. $300 million dollars devoted to new private ship construction with matching funds at the going subsidy rates would approximate some $600 million and would be adequate for approximately 30 to 40 of the newest and most efficient container-type ships depending upon design, to which could be added the necessary fast deployment logistic features so essential to the military forces.

This approach certainly would present a far more plausible program for maximum value out of dollars expended. Nevertheless, the conversion of AP-5 vessels is a more rational proposal than the upgrading of 150 regular victory ships. Even so, it should not be approved unless heavily weighed defense considerations supported by the best military intelligence available make it imperative.

As of June 30, 1966 there were 1,190 ships of all types in the Reserve Fleet amounting to 8,748,000 gross tons, 11,127,000 deadweight tons and averaging 22.6 years of age.

of this total there were 196 combination vessels averaging 22.2 years of age with 1,723,000 gross and 1,225,000 deadweight

tonnage.

946 freighters averaging 21.4 years of age totaled 6,612,000 gross and 9,272,000 deadweight tonnage.

There were only 2 bulk carriers averaging 22.0 years of age with a total of 14,000 gross and 22,000 deadweight tonnage. There were 46 tankers averaging 22.8 years of age totalling 399,000 gross and 608,000 deadweight tonnage.

The government-owned and actively operated fleet under General Agency Account, bareboat charter or other operating arrangement totalled 123 of which 121 were tankers and 2 were bulk carriers. Average age of this operating fleet is 22.1 years. Of the total government-owned fleet, 99.7% are over 20 years of age. Broken down by types; 98.5% of combination vessels, 99.9% of the freighters, 100% of the bulk carriers and 100% of the tankers, are in excess of 20 years old.1/

Such a fleet obviously does not engender much enthusiasm for a proposed expenditure of $345,000,000 when a Presidential budgetary recommendation to the Congress for fiscal year 1967 called for the construction of only 13 to 15 new merchant ships and a submission for 1968 augments this figure by only 2 to 3 ships.

When these two proposals are placed side by side, it portrays a rather sad assessment of the value placed upon the American Merchant Marine by existing Government leadership.

It is a fearsome reality that 80% of the Russian merchant fleet is under 10 years of age; that she is producing approximately 100 ships a year equalling 1 million deadweight tons; and that she presently has some 556 large merchant ships under

Figures in this and preceeding six paragraphs from publication by: Maritime Administration, Office of Maritime Promotion, Division of Trade Routes, March 31, 1967.

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construction while the United States dilly-dallys with upgrading a decadent Reserve Fleet. The composite of this kaleidoscopic picture is not an encouraging one.

All in all, it would seem the better course of wisdom to divert the total of $350 to $400 million--now proposed for conversion of 100 AP-5 and rehabilitation of some 150 AP-2 and AP-3 over a 5-year period--to new construction of modem container ships with high military potential. In turn, earlier retirement of C-2 and C-3 ships or even some of the older mariners, would substantially upgrade the National Defense Fleet. If it became necessary to further safeguard the military value of the Reserve Fleet, some modification of the Vessel Exchange Act (P.L. 89-254, trade-out program) might be considered, although generally, operating ships under U. S.-flag are normally a more substantial and readily available military asset.

AMERICAN-OWNED FOREIGN-FLAG SHIPS

RECOGNIZE THE WEAKNESS OF THE "EFFECTIVE CONTROL"
POLICY AS A MEANS OF INSURING AVAILABILITY OF
AMERICAN-OWNED FOREIGN-FLAG SHIPS IN THE EVENT OF
A NATIONAL EMERGENCY.

RE-EVALUATE THE DEPARTMENT OF DEFENSE POSITION
THAT "EFFECTIVE CONTROL" SHIPS CONSTITUTE A VITAL
NATIONAL ASSET.

OPPOSE THE GENOCIDAL PRACTICE WHERE BY AMERICAN
SHIPOWNERS DESTROY THEIR U.S.-FLAG COMPATRIOTS
WITH RUINOUS FOREIGN-FLAG COMPETITION GENERATED
BY LOW WAGE STANDARDS AND RUNAWAY TAX-FREE AMERICAN
CAPITAL.

STOP THE EXODUS OF U.S. MERCHANT SHIPS TO FOREIGN-
FLAG REGISTRY AND ENCOURAGE THEIR RETURN BY RE-
DESIGNING GOVERNMENT POLICY TO ACHIEVE A CLIMATE
CONDUCIVE TO CAPITAL INVESTMENT AND COMPETITIVE
OPERATIONAL STABILITY.

The Government has pointed to the return to the United States of American-owned foreign-flag ships to U.S.- flag operation in World War II. This provides little or no justified assurance in the event of a major confrontation with the Communist world today for the following reasons: In World War II the Communist world was appreciably confined to Russia and certain sympathetic areas elsewhere. Today, Comminist influence spreads around the globe.

1.

2.

It directly involves all or Russia, Rumania,

Czechoslovakia, Bulgaria, Hungary, West

Germany, Latvia, Estonia, Poland, China,
Albania, Cuba, Yugoslavia and Lithuania, and
has made heavy inroads into the political part-
ies and national life of many countries in
the free world. There is thus no compari-
son between the two periods nor the rela-
tive dangers inherent in controlling for-
eign crew activities;

The United States and her Allies were
fighting on the side of Communist Russia
in World War II so there was patently no
reason for disloyal or mutinous action on
the part of foreign crews of Communist per-
suasion. We were, in effect, their Allies;
and,

3. Our enemies in any future conflict would

undoubtedly be Communist countries. This has already occurred in the conflicts of both Korea and Vietnam although no major Communist nations have been directly involved. In wars of any major consequence, the motive of foreign crews to defect would be directly impelled by converse ideology and thus the exact opposite of the World War II situation would appertain.

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